Replies to post #1253 on Spectrum Brands Holdings Inc (SPB)

[Enterprising Investor]

Fortune Brands Announces Agreement to Acquire Emtek and Schaub Premium Residential Hardware Brands and the U.S. and Canadian Yale and August Residential Smart Lock Brands from ASSA ABLOY (12/01/22)

- Yale and August add scale and breadth to Fortune Brands’ complementary security and connected smart home portfolio in the U.S. and Canada

- Emtek and Schaub lead entry into new, highly synergistic premium brand-led category

- Transaction supports Fortune Brands’ disciplined inorganic growth strategy and augments its opportunities in supercharged categories

DEERFIELD, Ill.--(BUSINESS WIRE)--Fortune Brands Home & Security, Inc. (“FBHS,” “Fortune Brands” or the “Company”), an industry-leading home and security products company, today announced it has entered into a definitive agreement to acquire the Emtek and Schaub premium and luxury door and cabinet hardware business and the U.S. and Canadian Yale and August residential smart home locks business (collectively the “Business”) from ASSA ABLOY, Inc. (a subsidiary of ASSA ABLOY AB), for a purchase price of $800 million, or approximately $700 million net of tax benefits, in cash on a cash-free, debt-free basis, subject to customary adjustments (collectively, the “Acquisition”).

“This Acquisition is perfectly aligned to our strategy as a brand, innovation and channel leader. Yale and August will bring two great brands and significant engineering expertise into our already powerful security portfolio. Emtek and Schaub allow us to enter a branded, growing and highly profitable category in a leadership position, where we can accelerate innovation and leverage our channel and consumer insights to create significant value over time,” said Fortune Brands Chief Executive Officer Nicholas Fink. “This transaction is consistent with Fortune Brands’ disciplined approach to value-creating acquisitions.”

“Together with our existing iconic brands, loyal channel relationships, and supply chain expertise, we believe these additions will result in enhanced, innovative products for consumers and customers. We can accelerate growth and profitability by deploying our Fortune Brands Advantage capabilities to create value for all stakeholders,” added Fink.

With revenues of approximately $350 million in 2021, the Business is comprised of leadership brands in the fast-growing smart lock and the highly profitable and growing premium and luxury hardware categories. Fortune Brands expects to add meaningful growth and cost synergies to the Business over time.

Fortune Brands expects to receive tax benefits over a 15-year period with a net present value of approximately $100 million, and the net purchase price of $700 million equates to approximately 7.8x estimated 2022 adjusted EBITDA for the Business before synergies.

The Acquisition is conditioned on the successful closing of the acquisition by ASSA ABLOY from Spectrum Brands, Inc. of its Hardware and Home Improvement business following a favorable resolution of the court proceedings with the Department of Justice. The Acquisition is expected to close in the second quarter of 2023.

About Fortune Brands

Fortune Brands Home & Security, Inc. (NYSE: FBHS), headquartered in Deerfield, IL., is a Fortune 500 company, part of the S&P 500 Index and a leader in the home products industry. With trusted brands and market leadership positions in each of its three operating segments, Water Innovations, Outdoors & Security, and Cabinets, Fortune Brands’ 28,000 associates work with a purpose to fulfill the dreams of home.

The Company’s growing portfolio of complementary businesses and innovative brands includes Moen and the House of Rohl within Water Innovations; outdoor living and security products from Therma-Tru, LARSON, Fiberon, Master Lock and SentrySafe; and MasterBrand Cabinets’ wide-ranging offerings from MANTRA, Diamond, Omega and many more. Visit www.FBHS.com to learn more about FBHS, its brands and how the Company is accelerating its environmental, social and governance (ESG) commitments.

https://www.businesswire.com/news/home/20221130006222/en/Fortune-Brands-Announces-Agreement-to-Acquire-Emtek-and-Schaub-Premium-Residential-Hardware-Brands-and-the-U.S.-and-Canadian-Yale-and-August-Residential-Smart-Lock-Brands-from-ASSA-ABLOY

[Enterprising Investor]

ASSA ABLOY sells Emtek and the Smart Residential business in the U.S. and Canada in furtherance of the proposed acquisition of the Hardware and Home Improvement division (12/02/22)

STOCKHOLM, Dec. 2, 2022 ASSA ABLOY has entered into binding agreements with Fortune Brands Home & Security, Inc. (NYSE: FBHS) or ("Fortune Brands") for the sale of Emtek and the Smart Residential business in the U.S. and Canada to fully resolve all the alleged competitive concerns surrounding the proposed acquisition of the Hardware and Home Improvement division ("HHI") of Spectrum Brands.

On September 8, 2021, ASSA ABLOY announced it had signed an agreement to acquire the HHI division of Spectrum Brands (NYSE: SPB) for a purchase price of MUSD 4,300 on a cash and debt free basis. On September 15, 2022, the U.S. Department of Justice ("DOJ") announced that it will seek to block the proposed acquisition of HHI.

ASSA ABLOY has entered into binding agreements with Fortune Brands for the sale of Emtek and the Smart Residential business in the U.S. and Canada to fully resolve all the alleged competitive concerns surrounding the proposed acquisition of HHI. Residential businesses outside of the U.S. and Canada are not in scope to be divested.

These businesses represented sales of about MUSD 350 in 2021.The selling price for the divested business is MUSD 800 on a cash and debt free basis.

"With Fortune Brands our excellent US and Canadian residential businesses will get a good and strong home with an experienced owner. While keeping these residential businesses in the US and Canada would have been preferred, we are confident that we have now fully eliminated all competitive concerns alleged by the DOJ and that the acquisition of HHI is in the long-term interest of our shareholders," says Nico Delvaux, President and CEO of ASSA ABLOY.

The divestiture is dependent on the successful defense against the DOJ regarding the planned acquisition of HHI. ASSA ABLOY will remain fully committed to these well-performing businesses during the process and all the businesses will continue to operate as normal.

Both the proposed acquisition of HHI and the divestiture are expected to close during the second quarter 2023 after the successful defense against the DOJ.

For more information, please contact:

Nico Delvaux, President and CEO, tel. no: [phone]

Erik Pieder, CFO and Executive Vice President, tel. no: [phone]

Björn Tibell, Head of Investor Relations, tel. no: [phone], e-mail: [e-mail]

About ASSA ABLOY

The ASSA ABLOY Group is the global leader in access solutions. The Group operates worldwide with 51,000 employees and sales of SEK 95 billion. The Group has leading positions in areas such as efficient door openings, trusted identities and entrance automation. ASSA ABLOY's innovations enable safe, secure and convenient access to physical and digital places. Every day, we help billions of people experience a more open world.

https://www.prnewswire.co.uk/news-releases/assa-abloy-sells-emtek-and-the-smart-residential-business-in-the-us-and-canada-in-furtherance-of-the-proposed-acquisition-of-the-hardware-and-home-improvement-division-301692308.html